Greece talks delay sees stocks fall

Stocks edged lower today as talks over keeping Greece solvent stalled and got extended into the weekend.

Healthcare stocks rose sharply, though, after the Supreme Court upheld the Affordable Care Act’s insurance subsidies.

The Dow Jones industrial average lost 75.71 points, or 0.4%, to 17,890.36. The Standard & Poor’s 500 index fell 6.27 points, or 0.3%, to 2,102.31 and the Nasdaq composite fell 10.22 points, or 0.2%, to 5,112.19.

Stocks had been flat to slightly higher the first half of the day. But that momentum was soon lost and Greece worries turned the market lower in the early afternoon.

The bitter stand-off between Greece and its international creditors was extended into the weekend, days before Athens has to meet a crucial debt deadline which could decide whether it defaults on its debt and has to drop out of the euro.

A key meeting of eurozone finance ministers broke up today without agreement on Greece’s rescue package, intensifying doubts about whether Athens can make a 1.6 billion euro (£1.1 billion) debt payment to the International Monetary Fund that is due on Tuesday.

An agreement on a drastic Greek tax and austerity reform package is necessary for creditors to unfreeze 7.2 billion euro (£5.1 billion) in bailout money.

Greece has a small economy and its debt problems have been long known by investors. However, the possibilities of destabilising the euro and the implications of a country defaulting on its debt have weighed on investors for months now.

“It’s fair to say markets have been somewhat complacent about the risk related to Greece and it’s all coming to a head now,” said Ben Mandel, a global strategist at JPMorgan Multi-Asset Solutions. “It could cause some volatility next week.”

Healthcare stocks, especially hospital operators, rose sharply after the Supreme Court upheld the nationwide tax subsidies under President Barack Obama’s healthcare overhaul.

The ruling will preserve health insurance for millions of Americans who are not covered under state-owned exchanges.

Humana rose 7%, HCA Holdings jumped 9%, Tenet Healthcare increased 12% and Cigna went up by 2%.

US government bond prices fell. The yield on the 10-year Treasury note rose to 2.40% from 2.37% the day before.

In the energy markets, the price of oil fell on continuing concerns that high supplies of petrol and diesel will keep a lid on crude demand.

Benchmark US crude fell 57 cents (36p) to close at 59.70 US dollars (£37.92) a barrel in New York.

Brent crude, a benchmark for international oils used by many US refineries, fell 29 cents (18p) to close at 63.20 US dollars (£40.14) in London.